On Tuesday, coffee prices eased from their 52-week rally due to the weather conditions that gave zero rain to Brazil.
US coffee futures for September delivery declined by -1.67% to $2.39 a pound on July 23’s Asian afternoon session, showing a 1.00% weekly dip. Over the last 12 months, the bean prices climbed almost 47.00%, up over 27.00% year-to-date.
According to analysts, Brazil’s ongoing lack of rain, including the crucial growing areas, weighed on its production. Its harvest on July 16 equates to 74.00%, an improvement from the 66.00% from last year’s period. Also, it is slightly over the 70.00% long-term average.
On the other hand, Safras & Mercado decreased its 2024/25 coffee output forecast to 66 million bags from its past outlook of 70.4 million bags, citing higher-than-normal temperatures and drought that compromised yields.
Meanwhile, the recovery in ICE-monitored supplies from previously low levels is bearish for prices. On Monday, its robusta bean inventories increased to a one-year high, reaching 6,381 lots, surpassing the 1,958 lots reported in February.
Moreover, arabica coffee supplies reached a year and a half high, equating to 842,434 bags, beating the 24-year slump of 224,066 bags reported in November 2023.
Robusta and Arabica Coffee Rose on Mixed Signals
According to reports from a London exchange, robusta coffee prices significantly increased on July 22. Similarly, the ICE stated a jump in arabica beans.
Robusta prices for September deliveries increased by $51.00 per ton, while arabica prices decreased by $243.05 a pound.
In Uganda, robusta’s sales experienced solid performance, with the highest volume of 60-kilo bags sold. Last month, their market report mentioned that a total of 667,037 bags of coffee priced at $162.36 million were shipped in June. The commodity had an average price of $4.06 per kilo, higher than the $3.27 a kilo in May.
